3.The Act implements the Scottish Law Commission’s recommendations in its Report on Judicial Factors(1). It consolidates and updates the various Judicial Factors Acts dating from 1849 to 1889, and related legislation, and aims to put in place an updated and comprehensive regime in this area of the law. The Act is in 6 parts, as follows:
Part 1 makes provision for the appointment of judicial factors by application to the Court of Session or the appropriate sheriff court. It makes clear that it is open to the Court of Session or the sheriff court to appoint a judicial factor in the course of other proceedings, gives the courts a power to appoint an interim judicial factor in certain circumstances, sets out the grounds for appointing a judicial factor, and lays out the necessary qualifications for a judicial factor. It makes provision for the factory estate to vest in a judicial factor and for a judicial factor to intromit with the estate, and for the remuneration of judicial factors. It places a duty on the Scottish Ministers to issue guidance about the appointment of judicial factors on the estates of missing persons.
Part 2 deals with the functions a judicial factor has by virtue of appointment. It confers a general function of holding, managing, administering and protecting the factory estate for the benefit of those with an interest in the estate. It provides that a judicial factor has all the powers of a natural person beneficially entitled to the estate, with an illustrative list of such powers provided in schedule 1. It includes provision enabling a judicial factor to request relevant information in relation to the estate from bodies and individuals. In relation to the specific functions of judicial factors, the Act preserves the existing duty to prepare an inventory of the estate, and introduces a new duty to prepare a plan as to how the judicial factor proposes to hold, manage, administer and protect the estate, which must be approved by the Accountant of Court (“the Accountant”). It requires the judicial factor to regularly report to the Accountant, including by the submission of accounts, the factor’s dealings with the factory estate.
Part 3 makes provision about third parties acquiring title from or entering into dealings with judicial factors, including making it clear that the judicial factor stands in place of the factory estate in any such dealings.
Part 4 sets out simplified administrative processes for the distribution, termination, recall and discharge of a judicial factor. It provides for the approval by the Accountant of a scheme for distribution of the factory estate, avoiding the need to refer the matter to the court where there is no dispute. Where there is an objection, the Accountant must refer the matter to the court. It sets out processes for distribution of the factory estate on application by interested parties, for the termination of a factory estate and the recall and discharge of judicial factors, the appointment of replacement judicial factors in the case of death or ceasing to perform duties, and for the resignation of judicial factors.
Part 5 updates the current provision in relation to the requirements of the office of the Accountant of Court, particularly the function of supervising judicial factors. The Accountant currently has the power to direct a judicial factor as to how the duties of the office should be performed, and the power to require certain information from banks. These powers have been preserved and updated in the Act, with the Accountant being able to request any information relevant to their functions from any person or body, and the recipient of such a request, subject to certain exceptions, being under a duty to comply. The Act also imposes a duty on the Accountant to investigate any misconduct or failure by a judicial factor and report serious misconduct or material failure to the court.
Part 6 contains miscellaneous and final provisions, including abolishing the power to appoint a curator bonis, an interpretation clause and provision for commencement of the Act.